Category Archives: Opinion / EdiTOADial

In the second week of September something happened which has not occurred for a very long time with any Canadian provincial government – the Saskatchewan government announced new timber allocations. …All four companies receiving these timber allocations have capacity investments of almost $1 billion. …Saskatchewan’s announcements make me want to call this province the “US South of Canada” because I cannot recall in the last decade when else such a large active expansion of the Canadian industry has taken place.

…One might conclude that the geographical limits of economically feasible timber supply in the BC interior were tested with this last price rally given the record margins earned by sawmills. …Major capacity investments will go elsewhere as BC government policy cannot just physically increase timber supply in the short term, unlike Saskatchewan where provincial forests were underutilized. Furthermore, BC has some of the highest delivered log costs in North America in part due to its stumpage system.

Reduced options due to a constrained timber supply also explains the reasoning behind why the BC government continuously pushes for “value-added manufacturing” (it is just too bad, no one really knows what value-added means). The challenge for the BC government will be to develop unique policy that supports the industry while timber supply is shrinking (and to hopefully not make further arbitrary supply reductions i.e., politically motivated old growth timber deferrals). Ironically, all four companies receiving timber allocations in Saskatchewan are BC-based companies.

Russ Taylor Global: The global pandemic has created a wild lumber market since April 2020. …Following the peak of US lumber prices in late May 2021 at US$1,630/Mbf… lumber prices have slowly clawed their way higher to US$472/Mbf (as of Sept 17)… [and] the outlook is for improving US prices into fourth quarter before a likely correction occurs later in the year. In looking into 2022, prices could be in the US $600/Mbf range at times in Q1 and Q2 before a more balanced supply and demand situation occurs with lower prices. Considering that the peak US lumber prices prior to 2018 was US$470/Mbf… projected price levels should look extremely attractive to most North American lumber mills. However, not in BC.

In Europe, the situation is like the US but with a different price cycle. While US prices took off very quickly at the start of the pandemic, European prices lagged and grew slowly as domestic as well as offshore market conditions took longer to crystallize. …In Asian markets, a somewhat similar trend to Europe is evident in Japan, where are prices peaked two to three months after the US market peak. …The cost structures of the BC interior sawmills are the worst in North America right now. …As a result, BC mills may be facing further curtailments in 2021-Q4 unless prices rise by up to US$100/Mbf, or until stumpage corrects to much lower levels starting in 2022-Q1. BC Coast mills are also negatively impacted by higher government stumpage rates.

Christine Gelowitz

The Association of BC Forest Professionals (ABCFP) has received a range of concerns from registrants in recent weeks about the individuals appointed to the provincial government’s old growth technical panel. These concerns range from questions about the qualification of the panel members to… concern about registrants who are critical of the government’s selection of candidates. …Some perspective is needed. First, the role of the ABCFP under the Professional Governance Act (PGA) is to ensure that only competent, registered forest professionals practice professional forestry. …This does not mean that the ABCFP governs the opinions of forest professionals or their freedom to express different viewpoints publicly. Second, the government is entitled to choose its advisors on matters of public policy.

These are challenging and polarizing times… and regardless of personal views about the management of public forests, forest professionals have to step back and re-examine the public interest at this pivotal time in history. …And while personal opinions of forest professionals can help shape the dialogue and direction, they must always remain cognizant that determining the outcome about how BC forests will be used or managed is the role of government. …The diverse, informed voices of forest professionals are integral to developing sustainable long-term solutions in forest management. Despite the challenges speaking out can present, I encourage you to find meaningful ways to wade into or lead discussions, to not get caught up in opinion-based rhetoric, but rather bring data and knowledge… to best meet the evolving public and First Nations interests.

BC, Alberta and New Brunswick, have different methodologies of setting stumpage rates for provincial sawlogs that can disproportionately impact sawmill operators.

When it comes to trying to analyze how public timber stumpage prices are set by some provinces in Canada for companies holding forest licences, this can be a real puzzle. Three provinces, British Columbia, Alberta and New Brunswick, have different methodologies of calculating and setting stumpage rates for provincial sawlogs that can disproportionately impact sawmill operators, as summarized below. New Brunswick has held its rates at the same level as was set six years ago. …Consequently, the provincial government may have foregone millions of dollars in public timber revenues in the last four quarters. …Alberta has taken the other extreme where timber stumpage prices are tied in a formula to monthly lumber prices for the previous four weeks. …In contrast to New Brunswick, Alberta appears to have captured its fair share on the value of its crown timber. In the middle is British Columbia with a third approach, and one that has turned out to be messy at times for forest operators when lumber prices are volatile.

Pricing timber on public forests does not have to be complicated for forest operators and sawmills, as Alberta and New Brunswick demonstrate. Why these three provincial stumpage systems are so widely different – and why BC’s timber formula lags the reality of lumber market prices – is a real puzzle. How then are the Americans supposed to assess these different provincial stumpage formulas as all being equitable, especially when the negotiations on the next US-Canada softwood lumber agreement take place?

The last few years of wildfires in BC… are a concern for all. In 2017, wildfire burnt a record 1.2 million hectares, which stunned everyone, including a fledgling NDP government. …Little did anyone know then, that 2018’s wildfire season would surpass 2017’s. With 2.6 million hectares burnt in these two years, was this a new trend in wildfire activity? The following two years, 2019 and 2020, were essentially no shows in terms of wildfire activity… Then came 2021, with 862,992 hectares estimated as burnt so far – the third greatest amount of area burnt, at least in the last 30 years. Astoundingly, these three standout years had a total area burnt that was approximately 1% of the entire province for each year – three occurrences so close together, now that makes for a bonafide trend. 

With this new trend established, the Province should be modeling impacts to timber supply and communities on a regional basis, reviewing how wildfires are budgeted for, reviewing how wildfires are fought, reviewing how they are dealt with afterwards, and to seek a massive boost in investments for mitigative treatments and infrastructure. With regards to the supply chain… The potential for wildfires to impact sawmills is anticipated every year and as such are usually prepared with built-up log yard inventories. Unfortunately, in areas with repetitive intense wildfire activity, sawmills will have their long-term timber supply reduced and may become the ones with some of the highest probabilities of closure in the province. 

Balanced solutions to B.C.’s old-growth forests protection that best serves all British Columbians is possible — but it seems out of reach. For example, the provincial government’s recently announced Old Growth Technical Advisory Panel that will dictate government’s decision-making on logging deferrals is very troubling. Not because of its intent, but for the blatant unbalanced representation of its members. This committee — absent of any forest-sector professionals, forestry-dependent communities or First Nations leadership — will recommend and lobby for new areas needed to be protected without any understanding of the consequences of their opinions. …But dig a bit deeper and you’ll find the composition of its members dominated by Sierra Club affiliates and other individuals … vocally against any continued old-growth harvesting.

…In the Fairy Creek standoff, sophisticated and wealthy environmental groups distort facts, disrespect First Nations leadership, recklessly ignore fire hazards, steal and vandalize equipment, leave their trash and encourage illegal blockades, but yet seem to be rewarded for such behaviour by being given the opportunity to comprise an unaccountable committee that will ultimately determine the future state of our forest industry. …There is a path forward that will work, but it requires people to actually talk to each other as opposed to an apparent encouragement of separate polarized camps of opinion. …The world’s need and desire for wood will not diminish. Shutting down old-growth logging in BC will only move the supply to unregulated regimes. 

Bruce Blackwell

Some of the most pressing and challenging issues that pose significant barriers to prescribed fire application include: our broad land management framework… gaps in legislation and policy and even definitions… legal liability for fire escapes… protection of human health and current smoke management guidelines… current high fuel loads… and capacity limitations as it relates to training and skills to execute sound, ecologically appropriate prescribed burns. …Before we can increase the landscape application of prescribed fire to a scale that is required to address the current fuel problems, we must work to reduce the barriers listed. As a collective group of practitioners, we need to do a better job of finding solutions to the barriers.

Bill Dumont

It is distressing and disrespectful that the Fairy Creek protesters have collected more than $1 million from the public using the Pacheedaht traditional territory and Pacheedaht resources to achieve that milestone. In addition to the urgent need for full transparency about what has happened with those funds the protesters should be delivering most of it to the Pacheedaht leadership and community who have continually and respectfully asked for these outsiders to leave their ancestral lands. With Trump-like misinformation about B.C.’s forestry practices the year-long Fairy Creek campaign has continued even though major logging deferrals were agreed to by the Pacheedaht, Teal Jones and the B.C. government months ago.

Lawlessness is escalating at Fairy Creek with illegal tree falling, continued civil disobedience, attacks on the hardworking RCMP enforcing a legal injunction, littering and vandalism including defacing road safety signs. Protester presence adds to already high forest fire risks in the area and there are significant human waste issues there. All taxpayers are being burdened by paying the huge costs of policing and protecting the public and the Pacheedaht people. The protesters and others supporting them are acting in a paternal and colonial manner by demanding the Pacheedaht people adhere to the protesters’ views of logging and resource development and promoting conflict in the Pacheedaht community. Time for this craziness to stop!

It’s a new decade, and we are now pondering government’s just-released initiative, “Modernizing Forest Policy in BC; Setting the Intention and Leading the Forest Sector Transition”. …First impressions? Obviously, the reference to completing the Contractor Sustainability Review process… was necessary and very welcomed. …More broadly, there are many elements we can agree on, be it through increased allocations to Indigenous peoples, increased volumes to communities, altering the BC Timber Sales program, or promotion of volumes directed to value-added manufacturers. …I’m doubtful about how exactly the intention of improving BC’s investment climate and our overall competitiveness will be achieved… taking away tenure from the majors (and potentially contractors) with an undefined compensation package.

Yet another important issue is the old-growth strategy. Government needs to make decisions based on facts, not the fictitious headlines that inundate media. Unfortunately, the math is a bit too simple: the more area government protects, the smaller the forestry sector will become. …Our expectation is that government will consult with those actively involved and responsible for delivering on most of the aspirations outlined, who include BC’s logging contractors, resource communities, and suppliers. We collectively bring a grounded reality and practicality to what can realistically and successfully be accomplished. We are amid yet another critical point in history. This time, if done right, the difference will be that such changes end up benefitting all of us in BC’s forest industry.

Yet again, the forest industry is caught in an escalating cycle of those opposed to B.C.’s resource sector and those whose livelihoods rely on our forests. In all ways, we should be thankful that peaceful and lawful protests can occur in our democracy. So kudos to those local community groups expressing desire for change; while we may not be in agreement about the changes, we do agree change is needed, and look forward to working with them in forging a successful future together. These days call upon all of us to take a long, hard look at how B.C.’s citizens want its forestry sector and economy to prosper. And we need to do this with facts and balance, not hyperbole and rhetoric. We will continue to speak out on the need to protect and enhance B.C.’s working forests as an absolute necessity. Without such assurances, any new business will be hard-pressed to make major investments in technology and productivity. 

The latest [media] stunt being [played by] some ENGOs is the “failing report card” on the government’s handling of the old-growth logging issue. Cute, but not really constructive. These days call upon all of us to take a long hard look at where we want BC’s forest sector and economy to head. But first, some fundamental contradictions have to be tackled head on. For some, there seems to be a false sense of reality that the current state of our forestry sector is just fine. Unfortunately, those of us in the business know very well that our reality is full of uncertainty and is stifling BC’s investment climate. We’ve often commented on (and will continue to do so) the need to protect and enhance BC’s working forests. Without such assurances, any new business will be hard pressed to make major investments in technology and productivity. …New political leadership and the potential for a revamped ministry that better supports the forestry sector might be the catalyst.

Roger Whittaker

When I open a story on my computer or spread the inky pages out before me, I have a certain level of expectations. …I do not expect to be walloped into stupidity by semantic sleight of hand and stealthy word placement the way I was when began to read the dreadful piece recently included in Tree Frog News daily email news aggregator, “Your hardwood floor was probably harvested illegally” subtitled “U.S. Forest Service test shows as much as 62% of U.S. wood products are mislabelled” by Rachel Koning Beals of MarketWatch. …Yet this piece you are now reading is not so much to call out Ms. Koning Beals about her twisty relativistic attempt to circumvent the truth. The commenters were on her like a swarm of South American Bees. This piece is to ask you, as a reader, if you also seek truth or if you are living in an echo chamber… Her morally superior high road is to not choose to use wood on your floor because you cannot be sure it wasn’t cut under nefarious circumstances, thus setting about to call into disrepute all who call the forest their office, the same way the No Fur folks destroyed the ingenuity and income of those who live in Canada’s North. …the point of this piece is to ask you, as a reader, to look at the use of linguistic sleight of hand as you read.